Since 1 January 2019, the amounts received by French employees
for working overtime can be exempt from income tax, up to an annual
ceiling of €5,000 net.
Due to the COVID-19 crisis, this amount was raised up to
€7,500 for overtime work accumulated between 16 March 2020 and
the end of the health emergency state in France. However, the
exempted remuneration for overtime outside of the health emergency
state shall not exceed the €5,000 ceiling.
The question arises as to whether or not this measure of tax
exemption for overtime applies to cross-border workers, in
particular French employees working for Monegasque employers.
A French ministerial reply (known as the "Reitzer
reply"), published in the Journal Officiel on 22
December 2020, provided clarification on the subject, and appeared
almost untouched in another ministerial reply, published on 9 March
2021.
